GAO: Foreigners tap sensitive info

The risk that foreign nationals working for U.S. companies or universities could gain unauthorized access to technologies that have dual military and civilian use — “controlled technologies” — is a lingering concern for U.S. national security, according to a report released this week by the U.S. Government Accountability Office. This liability could have serious repercussions as terrorists and countries hostile to the U.S. could potentially get their hands on sensitive technologies and adopt them into military forces, the GAO found. Intelligence and law enforcement sources also told the GAO that business executives, scientists, engineers and academics from “countries of concern” have gained unauthorized access to controlled technologies.

Tech companies and universities are required to apply for U.S. export licenses so foreign nationals from hostile countries, such as Iran and Sudan, can access these dual-use technologies, which include computer, telecommunication, laser and other technologies.

This problem highlighted by the GAO could take center stage as U.S. tech companies grapple with filling jobs that require high-level math, engineering and computer science skills. Many companies have turned to hiring people outside of the U.S. to fill the positions since there’s a current lack of U.S. college graduates equipped with the appropriate technical background to qualify for the jobs. For instance, the report said the U.S. government approved specialty occupation visas for about 1 million foreign nationals from 13 “countries of concern” working in fields such as engineering, computers and biological sciences between 2004 and 2009. However, about 3,200 of foreign nationals received export licenses to access dual-use technology during this same time period. Among the recommendations made by GAO is that the U.S. Attorney General, Homeland Security secretary, and Commerce secretary review visas — including H-1B visas — to assess the extent to which U.S. employers are obtaining export licenses before hiring foreign nationals from “countries of concern” to work with technology. “This assessment, using all available data from the three agencies, might involve reviewing a sample of H-1B specialty visas for employment in particular technologies, such as computers, electronics or biotechnology, to determine whether employers of the applicants should have applied for deemed export licenses,” the GAO said in summary. “The Secretary should use the results of this assessment to identify the vulnerabilities in the deemed export control system; plan to better target and inform companies, universities and agencies about deemed export licensing requirements; and develop and implement procedures for incorporating DHS immigration data into its enforcement screening activities.”

The report, titled “Export Controls: Improvements Needed to Prevent Unauthorized Technology Releases to Foreign Nationals in the United States,” (http://www.gao.gov/products/GAO-11-354) is dated Feb. 2 but was only released this week. In it, the GAO also faulted Commerce, Immigration and Customs Enforcement and other agencies for not heeding advice in previous GAO reports on the topic. “Commerce and ICE have not implemented prior recommendations to improve outreach to companies, universities and U.S. agencies to address weaknesses identified by GAO and the Commerce and DHS (Inspector Generals),” the report said. “As a result, employers may be obtaining deemed export licenses for release of technology to fewer foreign nationals than should be the case.” The report found that, between 2004 and 2009, the Commerce Department fined 14 U.S. companies about $2.3 million for giving foreign nationals from 25 countries unauthorized access to controlled technologies — and one company’s export privileges were suspended. Because of a change in the screening process, the Commerce Department also reviewed just 150 visa applications in 2009 to determine whether foreign nationals had received unlicensed access to technologies or source code, down from 54,000 in 2001. GAO deemed this change in the screening procedure as more reactive than proactive. In 2002, the GAO made a series of recommendations to Commerce and other agencies on ways to prevent this unlicensed transfer of technology use from reoccurring. For example, the GAO recommended that the Commerce should establish a compliance program to determine whether a foreign national is adhering to their license conditions, which would include on-site workplace inspections. Commerce erected such a program in 2006 but abandoned it a year later because of “competing priorities and budget constraints,” the report said. GAO also recommended in 2002 that Commerce should use all immigration data from Homeland Security to identify firms that failed to apply for export licenses so a foreign national could lawfully receive source code or gain access to dual-use technologies. The two have discussed how to share this data, but haven’t finalized plans yet. There’s also confusion among Commerce, ICE and the FBI about what role each agency is playing when tackling the problem. Agency officials said this lack of clarity has led to “a duplication of efforts and ineffective sharing of investigative information,” the report said, but the officials didn’t cite any specific cases. For its part, the Obama administration has taken steps to address the export license problem and has announced plans for reform, the report acknowledged. President Barack Obama signed an executive order in November that established an Export Enforcement Coordination Center to strengthen the government’s export enforcement efforts. In response to the report, a senior administration law enforcement official said, “We will look for things that are in the recommendations that make sense and we hope to act on them.” The official also noted that ICE operates an outreach program called Project Shield America, through which agents conduct visits to corporations and research institutes to educate them about when it’s necessary for foreign nationals to apply for deemed export licenses. ICE conducted 1,348 outreach visits in 2010 and has conducted 283 visits so far this year. The agency is looking to “broaden the pool of industry sector participants that will be receiving visits” this year, the official said.